Female pilots have been a rare breed in the 116 years of aviation in Vietnam, and female airline CEOs literally unheard of. Vietjet Air’s CEO Ms. Nguyen Thi Phuong Thao, however, made history in the traditionally male-dominated business, becoming the only female entrepreneur to start and run a major commercial airline.

Her extraordinary achievement put Ms. Thao on the list of most powerful businesswomen this year, defying stereotypes and breaking down barriers.

Ms. Thao is the ﬁrst self-made female billionaire in Vietnam, with assets of $2.5 billion, and the richest self-made female billionaire in Southeast Asia. She is now planning to order new aircraft to take advantage of a booming regional market for air travel and take Vietjet global. Whether she can pull it off will require overcoming Vietnam’s own aging infrastructure, a global pilot shortage, and Southeast Asia’s patchwork of aviation regulations.

But the Vietjet CEO has proven she can overcome barriers. Founded in 2007, Vietjet is now bigger than national ﬂag carrier Vietnam Airlines, as measured by passengers carried. Ms. Thao’s bold steps forward have attracted the attention of the world to her airline and to her homeland of Vietnam.

Vietjet Air’s CEO Ms. Nguyen Thi Phuong Thao

From a few domestic routes when ﬁrst launched, Vietjet gradually expanded its ﬂeet 80 aircraft servicing 120 destinations. “Our strategy is to expand to any regional market within a radius of 2,500 miles, so we can create bases that cover half of the world’s population,” she said.

Vietjet debuted on the Ho Chi Minh Stock Exchange in 2017, with a market capitalization of $1.4 billion. The following year it transported 23 million passengers, accounting for 46 per cent of Vietnam’s passenger market. While that’s about half of the 44 million passengers AirAsia, Asia’s leading budget carrier, carried last year, Vietjet has been growing faster than the Malaysian carrier.

Vietjet’s revenue climbed 27 per cent to $2.3 billion in 2018, while AirAsia’s rose 9 per cent to $2.5 billion. This year, Vietjet expects to grow faster, projecting it will carry 30 million passengers, up 30 per cent from last year. “We positioned Vietjet as a regional and international carrier from the very beginning,” Ms. Thao said. The two airlines have an intertwined history. AirAsia originally tried to partner with Vietjet in 2010 to enter Vietnam’s domestic air market, only to pull the plug on the deal in 2011.

The key to Vietjet’s success is to keep costs low by efficiently exploiting each ﬂight. It operates at a unit cost of 2.3 US cents per available seat kilometer (ASK), measuring the best efficiency in the industry. AirAsia’s is 3.1 cents per ASK, while US full-service carriers average about 7 cents. Vietjet aims to ﬁt even more passengers into its new, narrow-body Airbus A321neo planes. The newest A321neo aircraft arriving in September has 240 seats, more passengers per aircraft than other carrier’s aircraft.

Though a little cramped, Vietjet’s planes are on average 88 per cent full. “It’s an equation with a lot of unknown factors that you need to solve - and you need to solve them all at once,” Ms. Thao said of the operating challenge she faces. “There are many questions you need to have answers to, and if there’s one that you haven’t answered, you’ll surely fail.”

Asia is fertile ground for Vietjet’s expansion. The International Air Transport Association (IATA) estimates that demand for air travel in the Asia-Paciﬁc, the world’s fastest growing travel market, will double over the next two decades, representing an additional 2.8 billion passenger journeys every year.

Travel in Vietnam is also booming, supported by its rapidly growing middle class. The country’s air-ports handled 106 million passengers in 2018, up 13 per cent from the previous year. That number included 16 million foreign visitors, a 20 per cent jump from the previous year. Anticipating further growth, Vietjet has ordered 386 new aircraft, including 200 from Boeing and 186 from Airbus.

Its aggressive expansion is paying off. The company’s shares have more than doubled since its 2017 IPO, giving it a market value of over $3 billion - the second largest in Southeast Asia after Singapore Airlines. And Vietjet says it is in talks with partners across the region to expand outside of Vietnam.

A mother of three, Ms. Thao is known by colleagues as a workaholic, often working late into the night.

The billionaire’s biggest challenge will be negotiating landing slots at various Asian destinations, as governments carefully allocate carriers’ access to their airports. “ASEAN has a single aviation market initiative, but it does not include some of the major Asian aviation markets, like China, India, South Korea, Japan, and Australia,” said Mr. Albert Tjoeng, Assistant Communications Director at IATA’s AsiaPaciﬁc office in Singapore. “The region is composed of a patchwork of systems - both operational and regulatory - and harmonization is needed to maximize the capacity of networks, both in the air and on the ground.”

To obtain landing slots to more international destinations, therefore, airlines like Vietjet usually form joint ventures with partners in different countries. So far, Vietjet has a joint venture in Thailand that operates eight aircraft in an already very competitive market.

Another barrier to Vietjet’s expansion is infrastructure. In Vietnam, most major airports are already operating beyond their designed capacity. Tan Son Nhat International Airport in Ho Chi Minh City handled 38 million passengers in 2018, well above its annual capacity of 28 million. The same is true at other major airports in Vietnam, including Da Nang, Nha Trang, and the capital Hanoi.

Vietjet is open to investing in infrastructure to help alleviate these bottlenecks, Ms. Thao said. But the Vietnamese Government is yet to ﬁnalize plans on whether to expand existing airports or build new ones. Vietjet also faces increasing local competition. As at the end of last year, Vietnam had 174 registered commercial aircraft operated by at least four airlines. Earlier this year, Bamboo Airlines became the ﬁfth, launching with just four aircraft. And later this year Vingroup, Vietnam’s largest publicly-traded company by market value, plans to launch its own carrier, Vinpearl Airlines.

A shortage of pilots poses another challenge. According to Boeing, the aviation industry will need almost 650,000 new pilots over the next 20 years, with the Asia-Paciﬁc region requiring 244,000 and the Middle East 64,000. “The challenge for the industry and stakeholders, including governments and regulatory authorities, is to ensure that the infrastructure is adequate while regulatory and resource needs are met to ensure that countries are able to fully realize the beneﬁts that aviation can deliver,” said Mr. Tjoeng from IATA.

Vietjet’s CEO, however, remains undaunted. In addition to seating passengers more densely, she’s been able to boost profits by buying new planes in bulk at good prices. Ms. Thao’s goal is to make history a second time by turning Vietjet into the first global airline from Vietnam. “If we establish an airline in Europe, we can fly to every country there,” she said.

“With our competitiveness in services, aircraft, management capacity, and cost, and an ability to provide new services, I am completely conﬁdent that we can compete in other markets like Europe and the US,” she added. Having made history once, she has earned the right to be conﬁdent.